Trying to guide my friend... thoughts?

[freshstartfl]

As a result of my experience with bankruptcy, my oldest friend is considering filing as well. I just wanted some opinions on her situation, and to know how I can best guide her.

She is a widow with 4 children, aged 15 to 2. Their father/her husband was killed in 2007 in an automobile accident. She receives survivor's SSI benefits to the tune of approximately $30k a year. She does not work or have any other source of income. She is a renter with no assets. One of her children had a life-threatening disease (he's okay now, thankfully), and it left her with over $500k in medical bills.

My only concern is that she's still waiting for the majority of the life insurance policy to pay out. So far she's received only $10k. I think she's still due at least another $100k. It's my understanding that this life insurance could boot her out of a Chapter 7. Is that correct? Any other thoughts or comments? One idea I gave her was to invest the majority of it in protected college-savings plans for her children.

I realize that she's essentially "judgment proof" at this point, but she would like to buy a house in a few years, and there's no way she'll be able to with all of this medical debt.

Thanks!

[freshstartfl]

Wanted to add one thing -- she's only in her early 30's. She has her whole financial life and well-being ahead of her.

[AngelinaCatHub]

Not worried about the future financial, but well being means a lot.

If you are asking, my opinion has been questioned before but saying that, she should go for it. Bk or any other entity cannot take our touch her life insurance product. I would not waste a minute and get the med behind her. Have her use a lawyer of course as since you are a member, you know you are getting free advice. It is worth what you paid for it.

Anyway, I feel for her and shall drop a prayer for her and her kids. What a bummer. Only my opinion. ‘Hub

[AngelinaCatHub]

P.S. at this time, she is probably qualified for SSI, as well as SS widow benifit. Check this out for her. GBWY 'Hub

[freshstartfl]

Thanks Hub. I think she should file, as well. She says she "knows she needs to," yet she still seems uncertain. I'm trying to be supportive and not pushy, I only want what's best for her. I've also advised her to read this forum, so hopefully she'll be joining us here soon. So, if I'm understanding correctly, the life insurance on her deceased husband cannot be taken in bankruptcy?

[AngelinaCatHub]

Thanks Hub. I think she should file, as well. She says she "knows she needs to," yet she still seems uncertain. I'm trying to be supportive and not pushy, I only want what's best for her. I've also advised her to read this forum, so hopefully she'll be joining us here soon. So, if I'm understanding correctly, the life insurance on her deceased husband cannot be taken in bankruptcy?

[freshstartfl]

Thanks so much Hub. I appreciate the insight.